The document discusses research on employee ambassadorship and its link to customer loyalty and business results. It presents a conceptual model showing that emotionally and rationally committed employees can become advocates who actively promote the brand, while disconnected employees may become saboteurs who negatively impact reputation. Research findings demonstrate strong correlations between employee commitment measures and customer loyalty/satisfaction ratings.

2. Strengthening Bonds Driving Customer Commitment © 2007 Harris Interactive Employee Ambassadorship: Optimizing the Profitable Link Between Employees and Customer Loyalty Behavior Michael Lowenstein, PhD CMC Vice President and Senior Consultant Harris Interactive Loyalty

6. Harris Interactive Loyalty Concept & Model of Customer Commitment Strengthening Bonds & Building Relationships HARRIS INTERACTIVE Loyalty

8. Conceptual Framework: The Commitment Model Relationship Diagnostics Relationship Conditions Emotional Connection Commitment Dimensions Commitment Rational Connection PURCHASE ENVIRONMENT Trust Satisfaction Product Satisfaction Price Competitiveness Emotional Connection Rational Connection CONTRACTUAL COMMITMENT ROMANCE ACQUAINTANCE Corporate Reputation Policies Service Satisfaction

10. Connection of Employee Attitudes and Beliefs to Customer Behavior HARRIS INTERACTIVE Loyalty

11. The Role of People… Why They Can Be So Critically Important 70% 41% 68% … of customers LEAVE because of poor employee attitude … of customers are LOYAL because of a good employee attitude … of customer brand perception is determined by experiences with PEOPLE UK retailer: 1% increase in employee commitment = 9% increase in monthly sales Enterprise IG Source: Parkington and Buxton, Study of the US Banking Sector, Journal of Applied Psychologyy Source: MCA Brand Ambassador Benchmark Source: Ken Irons, Market Leader

14. Employee Mirroring Research HARRIS INTERACTIVE Loyalty

15. Conceptual Model of Service Quality (Berry/Parasuraman/Zeithaml SERVQUAL Model, Updated in 2000 ) Word-of-Mouth Communications Personal Needs Expected Service Perceived Service Service Delivery Service Quality Specifications Management Perceptions of Customer Expectations CUSTOMER PROVIDER Past Experience External Communication to Customers GAP 1 GAP 5 GAP 3 GAP 2 GAP 4

17. Measuring Customer and Staff Alignment Significant misalignment * Based on % 6/7 performance ratings on a 7-point scale

19. Perceived Performance Gap Profile Staff vs Special Education vs Mainstream Subject Areas * Based on % high (5) performance ratings on a 5-point scale High Performance* Special Education Mainstream Staff 70% 90% 50% 30% 10% 1. Simplicity of materials 2. Appropriateness of materials for reading levels 3. Overall cost 4. Responsiveness to service requests 5. Shipment accuracy 6. Range of mainstream materials available 7. Range of remedial materials available 8. Effectiveness in helping reach teaching goals 9. Overall graphic content 10. Contemporary nature of material 11. Speed of order delivery Overall Performance

20. Employee Mirroring: Customer Need Importance Perceptual Gaps Relative Importance Of Issue Actual vs. Perceived Customer Needs

21. Defining the Employee Ambassador Research Framework HARRIS INTERACTIVE Loyalty

22. Employee Research Approaches Employee Satisfaction, Values, and Loyalty Employee Engagement and Alignment Employee Commitment and Ambassadorship (Advocacy) Employee Attitudes and Behaviors Research

24. Customer Commitment and Advocacy Optimizing Customer Experience and Relationships Linking Customer and Employee Commitment to Business Results Strong Correlation Weak and Intuitive Correlation Customer Loyalty TQ and Satisfaction Employee Commitment and Ambassadorship Employee Engagement and Alignment Employee Satisfaction & Loyalty C U S T O M E R R E S E A R C H E M P L O Y E E R E S E A R C H Now Now 1990’s 1990’s 1980’s and earlier 1980’s and earlier

25. Personnel Psychology Volume 54 Issue 1 Page 101 - March 2001 To cite this article: DANIEL J. KOYS (2001) THE EFFECTS OF EMPLOYEE ATTITUDES, ORGANIZATIONAL CITIZENSHIP BEHAVIOR, AND TURNOVER ON ORGANIZATIONAL EFFECTIVENESS: A UNIT-LEVEL, LONGITUDINAL STUDY Personnel Psychology 54 (1), 101–114. THE EFFECTS OF EMPLOYEE ATTITUDES, ORGANIZATIONAL CITIZENSHIP BEHAVIOR, AND TURNOVER ON ORGANIZATIONAL EFFECTIVENESS: A UNIT-LEVEL, LONGITUDINAL STUDY DANIEL J. KOYS Department of Management DePaul University Abstract This study addresses the issue of whether positive employee attitudes and behaviors influence business outcomes or whether positive business outcomes influence positive employee attitudes and behaviors. We hypothesize that employee satisfaction, organizational citizenship behavior, and employee turnover influence profitability and customer satisfaction. Data were gathered from the units of a regional restaurant chain via employee surveys, manager surveys, customer surveys, and organizational records. Cross-lagged regression analyses show that employee attitudes and behaviors at Time 1 are related to organizational effectiveness at Time 2.

26. Issues Affecting Staff Belief in Employer and Brand Lower Brand Higher Brand Loyalty Loyalty Percent Employee Product Perceptions Employees Employees Difference Greater number of features than competitor 28% 48% +20%* Higher overall quality than competitor 41% 73% +32% Better overall value than competitor 38% 65% +27% More prestigious than competitor 34% 58% +24% More durable than competitor 36% 50% +14% More reliable than competitor 32% 59% +27% Employee Attitudes Toward Employer Company is customer-focused 32% 59% +27% Proud of company 28% 48% +20% Company is well-managed 38% 65% +27% Like working for company 41% 73% +32% * Actual difference is +71% (48%/28%) Source: Fram and McCarthy, Marketing Management, Jan./Feb., 2003

28. Employee Commitment Categories Employee Saboteurs – employees who, though still drawing a paycheck from the company, are active, and frequently vocal, detractors about the organization itself, its culture and policies, and its products and services. These individuals are negative advocates, communicating their low opinions and unfavorable perspectives both to peers inside the company and to customers, and others, outside the company Disinterested Seatfillers – employees who, because of their lack of interest, favorability toward or kinship with the company and its products, either do not communicate positive messages about the company internally or externally, or do not communicate at all. For these minimally involved members of staff, employment with the company is ‘just a job’, and very little more. Passive Contributors – employees who are generally satisfied with their jobs but rather ambivalent to mildly positive about the company overall, their relationship with it, and its products. They may communicate some generally positive messages about the company to others, but rarely and inconsistently. Positive Loyalists – employees who exhibit positive feelings about their job and emotional kinship with the company. They are favorable about the company, overall, have every intention of remaining with the company, and actively and positively perform on its behalf. Though their communication about the company to others is infrequent to nil, when they do communicate, the messages are largely positive. Employee Ambassadors (Advocates) – the most active level, representing employees who are strongly committed to the company’s brand promise, the organization itself, and its customers. Also, and importantly, they behave and communicate in a consistently positive manner toward the company, both inside and outside.

29. Presentation of First Generation Findings HARRIS INTERACTIVE Loyalty

31. Harris Poll Service Employee Baseline Results Thoughts/Feelings About Company Percent I trust the company I like the company (16%)* (18%)** (20%)* (8%)** * = Top Box % on 5-point description scale ** = Bottom Box % on 5-point description scale Employee Ambassadors Employee Saboteurs

32. Harris Poll Service Employee Baseline Results Thoughts/Feelings About Job Percent I very much enjoy doing my job The work I do provides valuable services and/or products to customers * = Top Box % on 5-point description scale ** = Bottom Box % on 5-point description scale (18%)* (6%)** (30%)* (5%)** I am very committed to my work (32%)* (2%)** Employee Ambassadors Employee Saboteurs

33. Harris Poll Service Employee Baseline Results Company Attributes/Diagnostics Percent The organization is well-managed The organization is focused on attaining the highest quality possible * = Top Box % on 5-point description scale ** = Bottom Box % on 5-point description scale (12%)* (16%)** (25%)* (6%)** The organization is very loyal to its employees (13%)* (16%)** Employee Ambassadors Employee Saboteurs

34. Harris Poll Service Employee Baseline Results Comparative Assessments (Fram & McCarthy Diagnostics) Percent # of product/ service features we provide Overall product/ service quality * = Percent rating their company ‘Much Better’ compared to competition (5-point scale) (29%)* (33%) (31%) (29%) (34%) (25%) (30%) Overall value of product/ service Trust among customers Long-term relationships with customers Perceived prestige of the organization Benefits of products/ services to customers Employee Ambassadors Employee Saboteurs

38. Swing Voter Analysis HARRIS INTERACTIVE Loyalty

40. Ambassador/Saboteur ‘Swing Voter’ Analysis Disinterested Seatfillers Saboteurs Passive Contributors Positive Loyalists Employee Ambassadors What turns passive, positive employees into ambassadors? What turns passive, disinterested, negative employees into saboteurs? Swing Voters

42. Swing Voter Analysis Importance Scores for Selected Attributes (“Swing Up” To Ambassadors, “Swing Down” To Saboteurs) Delighters Dissatisfiers Dual effects 4% 28% I trust the hotel 5% 2% I am very committed to my work - 4% The hotel will do whatever it takes to makes guests happy - 4% My immediate supervisor 6% 6% I feel a lot of stress at work 2% 6% The hotel is very loyal to its employees 23% 6% Overall value of service provided 10% 6% I very much enjoy doing my job The extent of diversity of co-workers I have a clear understanding of the hotel’s mission, goals, and objectives The hotel is focused on attaining the highest quality possible My work gives me a sense of personal accomplishment 8% - - 7% 13% 2% 4% 8% Swing Down Swing Up

46. Summary Points HARRIS INTERACTIVE Loyalty

48. For further information about Harris Interactive Loyalty’s Employee Mirroring and Employee Ambassadorship research techniques, please contact Michael Lowenstein, PhD CMC Vice President and Senior Consultant Harris Interactive Loyalty email: [email_address] Phone: 609-919-2524 Cell: 856-283-1182